A VPN, or virtual private network, can help you protect your online privacy. VPNs have become very popular over the past few years, as users are more conscious of protecting their personal data. Investing in VPN stocks can be a great way to benefit from this online trend.
We’ve rounded up the best VPN stocks on the market right now to add to your portfolio. These are all companies that could be strong long-term investments as VPNs become more mainstream.
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Best VPN Stocks
First Trust NASDAQ Cybersecurity ETF (NASDAQ: CIBR)
One of the best investments for anyone interested in VPN technology is not a stock – it’s an exchange traded fund. The First Trust NASDAQ Cybersecurity ETF is a way to invest in many of the top global cybersecurity companies at once.
Exchange traded funds a an excellent way to invest in a broader industry instead of a specific company. ETFs are great for newer investors who may be more risk-averse. Because ETFs have a full portfolio of multiple companies, they are typically less volatile than individual stocks.
The cybersecurity industry did very well last year despite the pandemic and the ups and downs of the market. This resulted in an excellent year for this ETF, which hit five-year highs in January 2021. The fund has managed to maintain these highs in the months since, without too many ups or downs.
The need for quality cybersecurity products isn’t going away anytime soon. Since this ETF contains a group of many of the best stocks in the industry, it’s a solid long-term addition to your portfolio.
Fortinet Inc. (NASDAQ: FTNT)
Fortinet is a cybersecurity company based in Sunnyvale, California. They make a wide variety of software and hardware products, such as VPNs, firewalls, anti-virus software, wireless access points, and more. They also have a research team that monitors digital security threats.
This company’s financial performance over the past year has been very strong, and their shares have steadily gone up in price to reflect this. Their revenue has gone up 23 percent year over year, and experts predict that their future earnings reports will reflect ongoing growth.
There are several factors that make Fortinet a strong investment moving forward. First, they have a diversified portfolio of products that includes both legacy hardware products and software services. This has allowed them to pivot as the market changes and adjust to new technology trends.
Fortinet’s balance sheet also looks strong right now. They made some smart investment decisions last year that helped them keep their cash flow up. Since stock market performance often reflects financial data, this bodes well for the future of the stock.
This stock has been steadily going up in price since November 2020, but dipped slightly in mid-May 2021. Fortinet’s current price to earnings ratio indicates that it is currently on the expensive side. However, this dip presents an opportunity for investors to grab this promising stock at a slightly better value.
Top VPN Stocks
NortonLifeLock Inc. (NASDAQ: NLOK)
NortonLifeLock is one of the world’s leading cybersecurity companies. Their products provide the digital security infrastructure for some of the world’s largest organizations. Their consumer-facing products also come pre-installed on some popular personal computer brands.
The company was originally founded as Symantec in the 1980s. They merged with Peter Norton Computing in the early 1990s. Today, Norton’s business focuses on consumer software products like VPNs, anti-virus software, and more.
This company is a part of the S&P 500, and they are also a Fortune 500 company. Despite being a major name in the cybersecurity industry, they are still a relatively cheap stock. Right now, their price to earnings ratio is approximately 22, which is significantly lower than the industry average.
Many tech stocks have struggled over the past few months due to a broader market sell-off, but this hasn’t been the case for Norton. In fact, Norton stock spiked in mid-May 2021. This puts them on pace to have one of their best trading weeks to date.
This growth is likely due to strong financial data from their first quarter earnings report. Both revenue and earnings were up, and the company managed to beat analysts’ expectations. This has led some experts to increase their financial guidance for the company moving forward.
Norton also pays a dividend yield of 1.96 percent right now. This makes it a good choice for income investors.
Overall, this stock provides a way to invest in VPNs and other essential security products at a good value. Despite explosive share growth this week, this stock has the potential to push even higher in the future.
Check Point Software Technologies Ltd. (NASDAQ: CHKP)
Check Point Software is another leading cybersecurity company. They are based in Israel but have offices in the U.S. as well. They provide both hardware and software products to organizations around the world.
One of Check Point’s most popular products during the pandemic has been their remote secure access VPN. Employees who work from home on their personal devices can use this network to conduct their work securely. It creates a secure connection with the company’s network and data center to ensure that important information isn’t compromised.
Check Point stock has performed very well over the last year as companies have expanded their digital security efforts. Their share price hit a high point in January 2021, but has gone down slightly since then.
Buying the stock now could be a great opportunity for investors to pick it up at a more affordable price point. Their price to earnings ratio is among the lowest in the industry right now, which means that the stock is considered relatively cheap.
The company’s revenue growth has been slow but steady over the past few years. This might not be the best pick for explosive returns next quarter, but it could end up being a very smart choice for long term returns.
Zscaler Inc. (NASDAQ: ZS)
Zscaler is a cloud security company based in California. While they don’t technically offer VPNs, they do offer viable VPN alternatives for large companies using cloud technology.
Zscaler’s zero-trust network access provides similar security for remote workers. However, it integrates into an organization’s existing cloud structure, eliminating the need for inconvenient on-site data centers and hardware.
Zscaler shares hit their highest point to date in February 2021, but have since dropped slightly from this peak. However, this appears to be a strong stock pick for the long haul.
Their most recent earnings data was very strong, indicating that they were able to keep their large enterprise customers through the pandemic. They’re also offering unique security solutions that are different from everything else on the market right now.
VPN Penny Stocks
Ribbon Communications Inc. (NASDAQ: RBBN)
Ribbon Communications is a small-cap technology and communications company. They offer a variety of products including cloud solutions and optical networks. They also offer VPNs and other security devices for mobile providers.
This stock spiked in February as a result of market volatility and interest in penny stocks. While shares have come down in price since then, this company still has a very low P/E ratio. This means that their stock is relatively inexpensive.
Their most recent earnings report met investors’ expectations but didn’t necessarily exceed them. This meant that guidance for the rest of the year went down slightly.
Since Ribbon Communications is a penny stock, investors should watch out for volatility and low trading volumes. However, this investment could be a good way to buy into VPNs and cybersecurity technologies at an affordable price point.
Should You Buy VPN Stocks?
VPN stocks are a great addition to any portfolio right now. As we spend more and more of our lives online, many people are starting to realize the benefits of digital security. A VPN creates a private internet connection that is much more secure than using the public internet.
As businesses transition more of their operations to remote work-from-home positions, they’re realizing the importance of digital security. Many companies are investing in larger, more powerful VPN services that can better address their needs as they grow.
Many people also use their VPNs to access international content and communications. For example, if you are in Canada but want to watch a TV show on American Netflix, you can use a VPN to do so. This makes these networks appealing for individual consumers as well.
Demand for VPNs and other cybersecurity services is increasing. Investing in this technology now could generate steady returns in the future as these VPN companies grow.
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VPN Stocks: Final Thoughts
VPNs and other security technologies are changing the way we use the internet. Investing in the companies that develop them could be a great opportunity for significant returns in the future.
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